Apart from the biggest productivity app in the world (their sales of Office for Mac alone must be staggering, and reach a VERY high percentage of Mac computers) and the operating system that is run on more than 90% of the worlds computers? Wow, what else do they need to make money on. Who cares if we think Vista sucks. Almost every time a PC ships, Vista (or XP) is installed on it.

Apart from the biggest productivity app in the world (their sales of Office for Mac alone must be staggering, and reach a VERY high percentage of Mac computers) and the operating system that is run on more than 90% of the worlds computers? Wow, what else do they need to make money on. Who cares if we think Vista sucks. Almost every time a PC ships, Vista (or XP) is installed on it.

Why are they so desperately trying to expand their company then?

While everything may look rosy now, Windows won't be around for ever. Microsoft needs to find new revenue streams, otherwise investors will look elsewhere and their stock price will fall. The can't just rely on Windows and Office to carry them home forever.

Quote:

Originally Posted by MacNut

They make good on the xbox. At least the game licenses.

Their Home and Entertainment division made a loss of ~1.2 billion in 2006.

The only way to expand their market cap, to get the traders to keep buying, is through expansion. How much larger can the Windows and Office market get? It can't really. It's a fairly steady stream now. They need to show growth and they are trying to find a hit. So far, those all seem to be misses.

Their Home and Entertainment division made a loss of ~1.2 billion in 2006.

Figures which are even worse once you remove the estimated $350m profit from Office:Mac out of the total. For some reason the MBU is thrown into that division rather than the Applications side of the company.

Because the margins were far higher with their software-devisions, which now make up 50% of their annual revenue. There is something to say about focus for companies, and I think the Thinkpads were distracting from that. IBM is not a consumer-orientated company, it's a B2B-company. As such, I'm also not sure if this prediction of Apple beating IBM means much, as they are competing for different markets.

While everything may look rosy now, Windows won't be around for ever. Microsoft needs to find new revenue streams, otherwise investors will look elsewhere and their stock price will fall. The can't just rely on Windows and Office to carry them home forever.

Their Home and Entertainment division made a loss of ~1.2 billion in 2006.

Simple putting all your eggs in one basket is always a bad idea. If you are doing really well in one of them it a good chance to take the money and start expanding your company in to other markets before that stream dries up.

Apple has made a lot of progress in the IT industry over the last few years, if they keep staying on they track they are now they show easily capture more market share.

Apple is not really an "IT" company anymore. They should be compared more to Sony than IBM. The biggest growth opportunities for Apple, and much of what's driving its stock price, are in consumer electronics, not IT a la IBM.

Apple is not really an "IT" company anymore. They should be compared more to Sony than IBM. The biggest growth opportunities for Apple, and much of what's driving its stock price, are in consumer electronics, not IT a la IBM.

And even if you consider Apple an IT company, it's in a far different sector than IBM. Apple is all front end consumer and business hardware focus - the enduser is the customer. IBM is an IT infrastructure company. The products they have on the market are marketed to company CIOs, not the user. Most consumers wouldn't have a clue what IBM offers these days, yet nearly everyone (even anti-Apple zealots) known the bulk of Apple's product line. Not that customer understanding is really a factor here, just pointing out how far apart IBM and Apple are from each other even within the IT world.

IBM sold their PC brands to Lenovo because they felt they could not compete with similar laptops produced by Dell and Apple. Especially given that most Thinkpads at the time cost the same as most PowerBooks, and Dell was undercutting the price by 30% or more it seemed logical. Something unknown to most is that they also included their Aptiva and Thinkcenter (now named Thinkcentre) brands. They also granted Lenovo a 5 year period where they could continue to use the IBM brand to ease the transition.

Today, IBM mainly produces Mainframe systems, Blades, and software (mostly AIX and IBM Linux). However, most of they money they make in this arena comes from their services, not the hardware itself.

TEG

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